Henry Pelifian | The Iraq War and Crony Democracy

Wednesday, 24 January 2007 01:19 by: Anonymous

    The Iraq War and Crony Democracy
    By Henry Pelifian
    t r u t h o u t | Guest Contributor

    Wednesday 24 January 2007

    Has our form of government evolved into crony democracy? What is crony democracy, and how does it relate to the Iraq War? What is crony capitalism? Let us start with crony capitalism, for it begins there.

    Crony capitalism is the practice of government supporting specific companies or industries for favorable treatment in legislation, government grants, legal permits and beneficial tax laws. The concepts of open competition and free markets do not apply, because government actively intervenes to assist privileged corporations. In crony capitalism, there is a close relationship between government and corporations, and their actions towards each other are mutually financially beneficial. National laws and regulations are enacted that provide special permission for particular companies for acquisitions, mergers, real estate transactions and tax benefits. The quid pro quo for Republican and Democratic politicians are campaign donations, future jobs for themselves or relatives, and are disguised or hidden perks in exchange for favorable legislation for privileged organizations. Crony democracy occurs when crony capitalism merges with democracy, with major players becoming interchangeable with the lobbying promoting it.

    President Eisenhower's warning about the military-industrial complex's undue and adverse influence on the country was prescient and prophetic. Contracts for military hardware were the hallmark of the military-industrial complex in his era. Now it has extended and grown to taking over logistic and myriad other functions of the US military and government overseas, often creating a revolving chair of government and corporate employees securing government contracts domestically and internationally by using high-level contacts while in government for private gain. It appears that the concept of public service has become a major instrument for accessing and obtaining wealth. There is little prohibition of our elected and appointed former government officials to work for private companies, using their influence to assist in securing high-value government contracts.

    A prime example of crony capitalism, extensively outlined in Robert Bryce's book "Cronies" is the company Brown and Root, with its subsidiary Halliburton garnering billions of dollars worth of government contracts in Iraq. Vice President Dick Cheney is Halliburton's former chief executive officer. Cheney traded his government contacts when he was hired by Halliburton for domestic and foreign contracts with people with whom he formerly had conducted official business. There was no conflict of interest charge against Vice President Cheney when his former firm Halliburton secured billions of dollars of US government contracts in Iraq.

    Mr. Bryce states in his book that Dick Cheney departed Halliburton after five years with a retirement package worth $33.7 million dollars, shortly before being sworn in as vice president of the United States. Vice President Cheney also received deferred compensation from Halliburton totaling nearly $400,000 while in office.

    In "Cronies," it is clear why Halliburton hired Mr. Cheney, for he "knew how to vacuum up federal money and federal contracts." Other facts from "Cronies": During Cheney's tenure at Halliburton, he nearly doubled the amount of federal contracts to $2.3 billion. Also, Cheney assisted the parent company, Brown & Root, in receiving a fifteenfold increase in federally backed loans and insurance from the Export-Import Bank and the Overseas Private Investment Corporation. Mr. Cheney understood the importance of lobbying, for he doubled political donations while at Halliburton.

    According to the Center for Public Integrity and mentioned in "Cronies," seventy companies and individuals who were substantial contributors to the Bush-Cheney campaign have been awarded billions of dollars in contracts in Iraq.

    Have we become a nation of lobbyists, for lobbyists, and by lobbyists? The crony democracy chain links politicians, government appointees, corporations, government contracts and lobbyists. The chain includes interchangeable employment with each successive administration from government officials to corporate CEO or Washington lobbyist. The goal is profit at government expense. What is the financial calculation of waste and abuse in such a system?

    Should it be legal for former government employees to use their prior government experience to enrich themselves by securing lucrative government contracts? What is the public interest? The question is not only about Cheney. What of the many other former government and military employees who trade their government experience and influence for private gain? When is former government service, especially by high-ranking officials, an abuse of the public trust, when they use their influence for private gain?

    Is elected office just another avenue to gain access to wealth and privilege? Should there be a long-term prohibition of elected officials and retired military personnel from working with firms the government has done business with?

    We have now embarked upon a new age of crony democracy, where each of the two major political parties, Democratic and Republican, exclusively harness hundreds of millions of dollars from corporations and others to campaign for public office. Crony democracy requires cronies. Former Secretary of State James Baker III's law firm Baker Botts handles the legal affairs of Halliburton, Exxon-Mobil and an assortment of major companies for annual revenues of $362 million dollars, according to the book "Cronies." Former employees of Baker Botts have been appointed to such jobs as ambassador to Saudi Arabia and Department of Justice lawyer heading up the anti-trust division with oversight over energy issues.

    Is it plausible for Americans to ask, Were the corporations that Bush, Cheney and Rumsfeld had close relationships with a factor in the decision-making process to attack Iraq, since many of these companies secured multimillion or multibillion-dollar government contracts as a result of the Iraq War? Were government contracts directly relating to the Iraq War signed with companies with Bush-Cheney-Rumsfeld connections prior to the attack on Iraq, and is this a conflict of interest?

    The answer is not in stars; it is in intense scrutiny of the ever-widening circle of the military-industrial complex and implementing legislation that is currently absent, by curtailing or curbing or eliminating this new age of crony capitalism and crony democracy that has descended upon the American people and their government.


    Henry Pelifian's background includes public and private sector experience and an MBA in International Management. He has served many years overseas, including two years (1966-1968); an honorable discharge from US Army service in Vietnam (1967-1968), and the US Peace Corps in Thailand (1975-1977). He has written several works of fiction based on his experiences overseas. His parents were born in Turkey and escaped the Armenian Genocide. His father entered the US in 1921, and his mother's family went to France.

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